Top Greek Tax Official Is Dismissed

The Greek government said Katerina Savvaidou failed to fulfill her duty to aggressively collect taxes and fight tax evasion.CreditCreditSimela Pantzartzi/European Pressphoto Agency

By Niki Kitsantonis

Oct. 22, 2015

ATHENS — The Greek government on Thursday dismissed the country’s top tax official, saying she was not fulfilling her duty to aggressively collect taxes and fight tax evasion.

The firing of the official, Katerina Savvaidou, the head of a supposedly independent public revenue authority, came at a sensitive moment in the country’s effort to mount an economic comeback and live up to the conditions of its international bailout program.

The government is eager to begin receiving payments from the 86 billion euro, or $97.6 billion, bailout program it agreed to this summer with its eurozone creditors. Disbursement of small slices of that money is contingent on the creditors’ assessment of the progress of the country’s economic overhaul measures. Greece’s notoriously porous tax collection system and high level of tax evasion are parts of the economy that creditors have demanded be fixed.

Despite the government’s stated reason for dismissing Ms. Savvaidou, it was too early to tell whether Greece’s creditors might nonetheless see her firing as an unwelcome political encroachment on what is supposed to be an independent agency.

“We are definitely following the situation closely, but we have no comment to make at this stage,” Annika Breidthardt, a spokeswoman for the European Commission, said during a daily news briefing in Brussels on Thursday. The commission, the executive arm of the European Union, helps monitor the Greek bailout.

Ms. Savvaidou, who was appointed in June 2014 by the previous, conservative-led coalition, has lately been engaged in a public dispute with the left-leaning government of Prime Minister Alexis Tsipras, who was recently re-elected on a pledge to meet the conditions set by the country’s creditors.

The country’s finance minister, Euclid Tsakalotos, sought Ms. Savvaidou’s resignation last week, after a prosecutor charged her with breach of duty for granting Greek television stations additional time to pay a tax on advertising revenue. She is also being investigated in relation to a decision to review a €78 million fine on a Greek company.

Olga Gerovasili, a government spokeswoman, told reporters on Thursday that the Greek cabinet decided “unanimously” to dismiss Ms. Savvaidou. “In such difficult times for Greek society, for the Greek people, it is not acceptable for a public functionary to operate against the public interest,” she said.

Ms. Savvaidou had refused to step down, contending that her actions were not illegal.

She also cited the independence of the agency she led, the secretariat for public revenue, which was set up in 2012 under the conservative-led coalition government of Prime Minister Antonis Samaras at the behest of Greece’s creditors to stop political meddling in the country’s tax administration.

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A protester in front of the Greek parliament in Athens.CreditLouisa Gouliamaki/Agence France-Presse — Getty Images

Speaking by telephone, Ms. Savvaidou said on Thursday that she had not been informed about the decision by the government. “I heard about it on television,” she said.

In a written statement a few hours later, Ms. Savvaidou said that she had fulfilled her duties “to the full” and that extending a deadline for the payment of taxes was “a standard practice in administration,” not an offense.

Ms. Gerovasili, the government spokeswoman, said on Thursday that the government would not accept “certain companies that were given special treatment under previous governments, and which constituted the core of vested interests, being favored again.”

She did not name the companies. But the Tsipras government has pledged to break the ties among the political system, media organizations and Greek oligarchs. On Saturday, the Greek Parliament is scheduled to vote on legislation that paves the way for a new policy for issuing broadcasting licenses, a step vaunted by the government as the first step to establishing a truly independent media.

Ms. Savvaidou’s statement accused Ms. Gerovasili of “pre-empting the judicial verdict” by accusing her of granting favors to companies. The statement said Ms. Gerovasili had made “an unprecedented intervention” in the independence of the tax authority and Greek justice.

Ms. Savvaidou’s predecessor, Haris Theoharis, quit last spring after political pressure and accusations he was “mismanaging” his role.

No details were given regarding a successor to Ms. Savvaidou. A government official said that a “senior official in the general secretariat” would take over temporarily until a permanent replacement was appointed.

Mr. Tsipras is preparing for a visit by the French president, François Hollande, who is widely regarded as a staunch ally of Greece and a counterweight to Chancellor Angela Merkel of Germany and her strict prescription of budgetary austerity.

Mr. Hollande, who arrived in the Greek capital on Thursday evening for a two-day visit, was expected to urge the country to stay the course on overhauls and to encourage French investment in Greece.

He is traveling with a large delegation of French government officials and entrepreneurs. In an interview with the center-right daily Kathimerini, Mr. Hollande said, “I am coming to Greece to express France’s support, but also to send a message, particularly to French companies: Come and invest in Greece.”